ONE-TWENTY TWO: Trading Financial Markets
Exploring the poetry in financial markets for students of money and economy since the year 2000.
Stock Market Commentary And just like that, the bullish expansion of market breadth hit a wall…a wall of inflation. The October Consumer Price Index (CPI) for all urban consumers apparently surprised financial markets by soaring 0.9% from September and 6.2% over October, 2020. The chart below shows that both surges are at the high end … Read more
The Follow-Through: Strong Start for Stocks The month of September enjoyed a strong start as last week’s fairy dust from J-Pow continued to work its magic. Short-term market breadth with AT50, the percentage of stocks trading above their 50-day moving averages (DMAs), also continuing higher while leaving behind the longer-term breadth indicator in AT200, the … Read more
Stock Market Commentary Say whatever you want, Jerome (Jay) Powell, the chair of the Federal Reserve, affectionately known as J-Pow, has become a master orchestrator of the stock market. Other Federal Reserve Board members peppered the airwaves with hawkish talk about tapering and inflation in the days preceding Powell’s address at this year’s Jackson Hole, … Read more
Stock Market Commentary The drag I described in the wake of the Federal Reserve’s pronouncements on monetary policy eroded the stock market a lot more than I thought. Market breadth printed a major fakeout with my favorite indicator plunging in the wake of deep selling in inflation-related trades from commodities to industrials to financials. The … Read more
Stock Market Commentary The stock market is a cauldron of contradictions and divergences. Breakdowns below key support levels abound. Stocks suffer post-earnings fades even after companies report strong results, especially in both beaten up growth stocks and resilient big cap tech. Yet, the S&P 500 just rises above the steady erosion of market breadth with … Read more